SEC Approves First Triple-Leveraged Bitcoin and Ether ETFs in the U.S.
SEC allows higher leverage for crypto funds
The U.S. Securities and Exchange Commission (SEC) has approved a rule change that permits the first triple-leveraged Bitcoin and Ether exchange-traded funds (ETFs) in the United States. An ETF is a type of investment fund that trades on a stock exchange like a stock.
The approval marks a significant shift in the U.S. market. Previously, leveraged crypto funds were capped at two times (2x) the daily return of the underlying asset.
What to know about the new 3x ETFs
- The approval covers six different funds issued by Volatility Shares.
- The funds target Bitcoin, Ether, gold, silver, crude oil, and natural gas.
- Each fund aims to provide three times the daily performance of its specific asset.
- These products will hold regulated futures contracts instead of the actual digital tokens.
Details from the SEC and company filings
The SEC approved the Cboe BZX rule change on October 2, 2026. Despite this approval, the funds cannot start trading immediately. Volatility Shares still needs the SEC to declare its registration statement effective. The official order does not list a specific date for when this will happen.
The company stated in its preliminary prospectus that these investments are speculative. They are intended for people who can handle the risk of losing their entire investment.
Current status and trading restrictions
While the rule change is a major milestone, the products are not yet available to the public. Market analysts have noted that these funds are specifically built for active trading rather than long-term saving. Because the funds must reset their leverage every day, they have to buy more futures after prices go up and sell after prices go down. These mechanical actions usually happen near the close of the trading day and can make market price swings more intense.
Risks and mechanics for traders
Experts warn about a risk known as volatility decay. Because the funds reset daily, their returns over several days can be very different from three times the asset's total return. For example, if Bitcoin moves up and down frequently without a clear trend, the fund can lose money even if the price of Bitcoin stays the same. Volatility Shares acknowledged this risk, noting that more volatile assets have a higher chance of this type of capital loss.
Practical challenges for long-term holding
The use of futures contracts adds extra costs to the funds. As contracts get close to their expiration date, the fund must sell them and buy new ones that expire later. This process is called rolling, and it often costs more money. This creates a steady drag on the fund's performance over time. Because of these factors, industry experts suggest these ETFs are tools for short-term moves rather than long-term investment strategies.
Sources
Newisty Editorial Team covers technology, cryptocurrency, digital products, online platforms, developer tools and the wider digital economy. Our content is researched from official sources, company announcements, public documentation, market data and other primary or reputable sources. Articles are reviewed and edited before publication for clarity, accuracy and useful context.